Exhibit 4.03
FIRST AMENDMENT TO HOLDER RIGHTS AGREEMENT
THIS FIRST AMENDMENT TO HOLDER RIGHTS AGREEMENT (the "First Amendment")
is made and entered into as of February 24, 2000 by and between Videonics, Inc.,
a California corporation (the "Company") and Venture Banking Group, a division
of Cupertino National Bank (the "Holder").
WHEREAS, the Company and Holder have entered into that certain Holder
Rights Agreement dated as of September 15, 1999 (the "Agreement").
WHEREAS, the Company and Holder desire to amend the Agreement as set
forth in this First Amendment.
NOW, THEREFORE, the parties, intending to be legally bound, agree as
follows:
1. Amendment to Section 1.02. The first paragraph of Section 1.02 is
hereby amended in its entirety to read as follows:
If the Holder requests that the Company file a registration
statement on Form S-3 (or any successor form to Form S-3) for
a public offering of the shares of Registrable Securities, and
the Company is a registrant entitled to use S-3 (or any
successor form to Form S-3), the Company will use its best
commercial efforts to effect a registration on Form S-3 (or
any similar successor form) and any related qualification or
compliance with respect to all the Registrable Securities
owned by the Holder so that such registration will be filed
with the Securities and Exchange Commission within thirty (30)
days of the Company's receipt from the Holder of a written
request for such registration; provided, however, that the
Company shall not be obligated to effect any such
registration, qualification or compliance, pursuant to this
Section: (i) if the Company is not qualified as a registrant
entitled to use Form S-3 (or the applicable successor form);
(ii) if the Company shall furnish to the Holder a certificate
signed by the Chief Executive Officer of the Company stating
that in the good faith judgement of the Board of Directors of
the Company, it would be seriously detrimental to the Company
and its shareholders for such Form S-3 registration to be
effected at such time, in which event the Company shall have
the right to defer the filing of the Form S-3 registration
statement for a period of not more than one hundred twenty
(120) days after the date of the certificate; provided,
however, that the Company shall not utilize this right more
than once in any twelve (12) month period; or (iii) in any
particular jurisdiction in which the Company would be required
to qualify to do business or to execute a general consent to
service of process in effecting such registration,
qualification or compliance.
2. New Section 1.03. A new section 1.03 shall be inserted after Section 1.02
(and subsequent sections shall be renumbered) as follows:
1.03 Company Registration.
(a) Notice of Registration. If at any time or from time to
time the Company shall determine to register any of its equitable
securities under the 1933 Act for sale for cash, whether for its own
account or the account of any of its security holders or both, other
than (i) a registration relating solely to employee benefit plans, (ii)
a registration relating solely to a Rule 145 transaction, (iii) a
registration in which the only equity security being registered is
Common Stock issuable upon conversion of convertible debt securities
which are also debt securities which are also being registered, (iv) on
a Form S-4, Form S-8 (or Form S-3, if such registration covers an
offering of the type contemplated by Form S-8) or any successor or
similar forms or (iv) a registration pursuant to an agreement which, by
its terms, would prohibit the inclusion of Registrable Securities,
unless such prohibition is waived, the Company will:
(i) give to the Holder written notice thereof; and
(ii) subject to the terms of this Agreement, use its
reasonable efforts to include in such registration (and any
related qualification under blue sky laws or other
compliance), and in any underwriting involved therein, all the
Registrable Securities specified in a written request, made
within ten (10) business days after receipt of such written
notice from the Company, by the Holder; provided that the
provisions of this Section 1.03(a) are subject in all respect
to the provisions of Section 1.03(b) regarding underwritten
offerings.
(b) Underwriting. If the registration of which the Company
gives notice is for a registered public offering involving an
underwriting, the Company shall so advise the Holder as a part of the
written notice given pursuant to Section 1.03(a). In such event the
right of the Holder to registration pursuant to this Section 1.03 shall
be conditioned upon such Holder's participation in such underwriting,
and the inclusion of Registrable Securities in the underwriting shall
be limited to the extent provided herein.
The Company and the Holder shall enter into an underwriting
agreement in customary form with the managing underwriter selected for
such underwriting by the Company. Notwithstanding any other provision
of this Section 1.03, if the managing underwriter of such underwritten
offering advises the Company that marketing factors require a
limitation of the number of shares to be underwritten, the Company may
exclude some or all of the Registrable Securities from such
registration and underwriting. The Company shall so advise the Holder
of the number of shares that may be included in the registration, if
any, and the underwriting shall be allocated first to the Company and,
if additional shares may be sold, subject to any agreement which by its
terms would give any other person priority over, or rights similar to
those held by, the Holder relating to the inclusion of shares in such
registration, such additional shares shall be allocated to the Holder.
(c) Right to Terminate or Delay Registration. The Company
shall have the right to terminate or withdraw any registration
initiated by it under this Section 1.03 prior to the effectiveness of
such registration whether or not the Holder has elected to include
securities in such registration. If, at any time after delivery of a
notice of registration pursuant to Section 1.03(a) and prior to the
effective date of the registration statement filed in connection with
such registration, the Company shall determine for any reason to delay
registration of its securities, the Company may in its sole discretion
delay such registration upon notice of such determination to the
Holder, and the Company shall be permitted to delay registering any
Registrable Securities for any period it deems necessary in its
reasonable discretion.
3. Amendments to Sections 1.04(a) and (b). Section 1.04(a) is hereby amended in
its entirety to read as follows:
All Registration Expenses incurred in connection with any registration,
qualification or compliance pursuant to Sections 1.02 or 1.03 shall be
borne by the Company. All Selling Expenses shall be borne by the
Holder.
The first sentence of Section 1.03(b) is hereby amended in its entirety to read
as follows:
Definitions: "Registration Expenses" shall mean all expenses incurred
by the Company in complying with Sections 1.02 and 1.03 hereof,
including, without limitation, all registration, filing and
qualification fees, underwriters' expense allowances, printing
expenses, fees and disbursements of counsel for the Company, blue sky
fees and expenses.
4. Reference to the Agreement. On and after the effective date of this
First Amendment, each reference in the Agreement to "the Agreement," "this
Agreement," "hereunder," and "hereof" or words of like import referring to the
Agreement shall mean the Agreement, as amended by this First Amendment. The
Agreement, as amended by this First Amendment, is and shall continue to be in
full force and effect and is hereby in all respects ratified and confirmed. This
First Amendment shall be effective upon execution by the Company and the Holder.
5. Counterparts. This First Amendment may be executed in two (2) or
more original and identical documents, signed simultaneously or at separate
times by the parties, and each signed original shall be deemed to be an original
for all purposes.
6. Complete Agreement. The Agreement (together with its Exhibits and
the other documents referred to herein) and this First Amendment are intended by
the parties hereto to be the final expression of their agreement and constitute
and embody the entire agreement and understanding of the parties with regard to
the subject matter hereof and is a complete and exclusive statement of the terms
and conditions thereof, and shall supersede any and all prior correspondence,
conversations, negotiations, agreements or understandings relating to the same
subject.
7. Choice of Law . It is the intention of the parties that the internal
laws of the State California (irrespective of its choice of law principles)
shall govern the validity of this First Amendment, the construction of its terms
and the interpretation of the rights and duties of the parties.
IN WITNESS WHEREOF, the parties hereto have caused this First Amendment
to be executed by their duly authorized representatives as of the day
and year above.
VIDEONICS, INC.
By: /s/ Xxxx Xxxxxxxx
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Name: Xxxx Xxxxxxxx
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Title: V.P. of Finance and CFO
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VENTURE BANKING GROUP
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
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Title: Commercial Loan Officer
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